US Intelligence: China Economy to Surpass US by 2030

iStockphoto/Thinkstock(WASHINGTON) — A report on global trends prepared by the U.S. intelligence community notes that by 2030 China is likely to have surpassed the United States as the world’s largest economy. The report suggests the United States would likely serve as, “the first among equals” in a multi-polar world.

“China alone will probably have the largest economy, surpassing that of the United States a few years before 2030,” The report “Alternative Worlds” prepared by the National Intelligence Council notes in their findings released Monday at the National Press Club.

“In terms of the indices of overall power in gross domestic product, population size, military spending and technological investment, Asia will surpass North America and Europe combined,” said Christopher Kojm, Chairman of the National Intelligence Council at the press conference.

But a lot could happen in the next seventeen years. And there is uncertainty about how China will evolve.

“China is…the wild card. I mean, its actions itself can be its worst enemy, particularly if it becomes, as we’ve seen in a couple — starting a couple of years back, a lot more aggressive in the neighborhood, then actually is sowing a lot more support for continued U.S. — a continued U.S. role in the region,” said Dr. Matthew Burrows, counselor to the National Intelligence Council at a press conference Monday morning.

Despite the findings about China’s economy, the report notes that the United States will remain a dominant power militarily with a strong economy as the boom in domestic natural gas production possibly helps lower costs for manufacturing and reduces unemployment.

“When you broaden your definition of power beyond just the basic ones of GDP [Gross Domestic Product], military spending, R&D [Research and Development] and GDP, and you look broader at what a lot of the other — what a lot of people would call more softer powers, the U.S. still in 2030 stands head and shoulders above China, India and actually all other powers in the world,” Burrows said.

“The U.S. most likely will remain ‘first among equals’ among the other great powers in 2030 because of its preeminence across a range of power dimensions and legacies of its leadership role. More important than just its economic weight, the United States’ dominant role in international politics has derived from its preponderance across the board in both hard and soft power. Nevertheless, with the rapid rise of other countries, the ‘unipolar moment’ is over and Pax Americana — the era of American ascendancy in international politics that began in 1945 — is fast winding down,” The assessment noted.

Noting the abundant shale gas reserves in the United States the NIC report notes, “With shale gas, the US will have sufficient natural gas to meet domestic needs and generate potential global exports for decades to come. Increased oil production from difficult-to-access oil deposits would result in a substantial reduction in the US net trade balance and faster economic expansion.”

Among the reports other major trends and concerns noted are the growing demand for food and water with climate change exacerbating the need for these resources as the world’s population is expected to approach 8.3 billion people in 2030. The report also notes that the Middle East and South Asia could face increased instability as 2030 approaches.

“The Middle East’s trajectory will depend on its political landscape. On the one hand, if the Islamic Republic maintains power in Iran and is able to develop nuclear weapons, the Middle East will face a highly unstable future. On the other hand, the emergence of moderate, democratic governments or a breakthrough agreement to resolve the Israeli-Palestinian conflict could have enormously positive consequences,” the report noted.

While terrorism has been the main national security concern for the United States for over a decade the NIC report notes that Islamist terrorism is likely to decline but not completely disappear.

“The current Islamist phase of terrorism might end by 2030, but terrorism is unlikely to die completely. Many states might continue to use terrorist group out of a strong sense of insecurity, although the costs to a regime of directly supporting terrorists looks set to become even greater as international cooperation increases. With more widespread access to lethal and disruptive technologies, individuals who are experts in such niche areas as cyber systems might sell their services to the highest bidder, including terrorists who would focus less on causing mass casualties and more on creating widespread economic and financial disruptions.”

The report also notes that technology will help shape global-security, social and economic developments with increased productivity, automated technologies, precision agriculture and advancements in health care.

Noting the potential for major crisis the report notes the possibility of a severe pandemic as well as weapons of mass destruction and cyber attacks being carried out by non-state actors.

“Our work is invaluable to the administrations past and present. It helps to inform the Pentagon’s Quadrennial Defense Review. It has helped to inform the State Department’s Quadrennial Diplomacy and Development Review. And the policy planning staffs across the national security agencies are keenly interested in our work, and we know that senior policymakers are as well,” NIC Chairman Kojm said at the press conference.